Working Paper: 62

A Counting Multidimensional Poverty Index in Public Policy Context: the case of Colombia

Previous multidimensional indicators adopted in Colombia, such as the Unmet Basic Needs or the Living Conditions Index, lose their policy relevance and arguably have become poor instruments for poverty measurement. This paper presents the Colombian Multidimensional Poverty Index (CMPI), a synthetic indicator that overcomes the methodological problems that arose from previous multidimensional indices, and that has a broad public policy scope of use. The CMPI is based on the methodology of Alkire and Foster (2010); is composed of five dimensions (education of household members, childhood and youth conditions, health, employment and access to household utilities and living conditions); and uses a nested weighting structure, where each dimension is equally weighted, as is each indicator within each dimension. This paper proposes the CMPI to tracking multiple deprivations across the national territory, to monitor public policies by sector and to design poverty reduction goals, among other public policy uses. Analysis of the results demonstrates that multidimensional poverty in Colombia decreased between 1997 and 2010. Multidimensional poverty rates decreased in both urban and rural areas, but imbalances remain.